Ocwen Financial Halved As CFPB Alleges Failure 'At Every Stage'

Screen Shot 2017 04 20

Screen Shot 2017 04 20

The actions by the federal and state governments are the latest black eye for Ocwen, which grew to become one of the nation's largest nonbank mortgage servicing firms after the housing crash but has been swamped by regulatory problems and consumer complaints.

The West Palm Beach, Fla., company also was accused of illegally starting foreclosure on at least 1,000 consumers and relying on a system to service loans that even an Ocwen executive called "ridiculous" and a "train wreck", the bureau said in news release.

"Ocwen has repeatedly made mistakes and taken shortcuts at every stage of the mortgage servicing process, costing some consumers money and others their homes", CFPB Director Richard Cordray, who was appointed by President Obama, said in a statement.

Ocwen allegedly filed illegal foreclosures, collected excessive fees, mishandled loan modifications and misapplied mortgage payments, according to Florida's offices of the Attorney General and Financial Regulation.

The CFPB, the state of Florida, and other state agencies are suing Ocwen or issuing cease-and-desist orders against the company in the joint action filed Thursday. During this time, Ocwen allegedly was unable to send out accurate monthly statements or properly credit payments.

In a separate suit, the state of Florida alleged Ocwen committed errors that caused "significant harm to borrowers". Ocwen demurred, claiming that it would cost a prohibitive $1.5 billion to perform a comprehensive audit.

NEW YORK (AP) - State and federal authorities have sued mortgage servicer Ocwen Financial Corp., saying the company botched the handling of millions of mortgage accounts.

In addition, Ocwen was required to furnish the committee with a detailed financial health projection for the coming years.

A department spokeswoman said that Ocwen handles just over 45,000 loans in MI. Ocwen is one of the largest non-bank mortgage servicing companies in the country, and many of its clients hold subprime mortgages.

North Carolina's order will remain in effect until Ocwen turns over a complete reconciliation of its escrow accounts "showing that consumer funds are appropriately collected, property calculated, and disbursed accurately and timely". The company failed to make good on pledges to improve its mortgage-servicing performance since agreeing to a multistate settlement in 2014, said Bondi, who added, "enough is enough". RMD will update this post as soon as it receives comment.

Also, several states issued cease-and-desist orders against Ocwen to address mishandling of consumer escrow accounts and a deficient financial condition, specifically prohibiting the Company from acquiring new mortgage servicing rights and originating mortgage loans.